ECONOMICS

Detailed explanation-1: -Subcontract Cost means the amount to be paid to any subcontractor hired by Contractor for the principal purpose of obtaining the auditing services under this Agreement plus ten percent (10%) as an administrative fee to the Contractor.

Detailed explanation-2: -c) Under this method, any amount received from the Contractee till the completion of contract will be crediting to Contractee’s personal account debiting cash/bank. Amount so received will represent advance received from Contractee and will be shown as (work in progress less advance received) in the Balance sheet.

Detailed explanation-3: -Cost of Sub-Contract: The agreement or contract between the contractor and sub-contractor is called sub-contract. The payment made by the contractor to the subcontractor forms a direct charge to the contract (i.e., to the main contract) and therefore, debited to the Contract Account.

Detailed explanation-4: -Explanation of Contract Account All expenses incurred in fulfilling a contract (e.g., materials, wages, direct expenses, cost of sub-contracts, cost of special plants, and indirect expenses) are debited to a contract account.

Detailed explanation-5: -What is Contract Costing? Contract costing is the tracking of costs associated with a specific contract with a customer. For example, a company bids for a large construction project with a prospective customer, and the two parties agree in a contract for a certain type of reimbursement to the company.